Wine V. vinifera grape vineyard establishment cost resource updated

Cornell University’s Cost of Establishment and Production of V. vinifera Grapes has been revised based on 2013 industry values.

Growth in Michigan’s wine and grape industry continues. The Michigan Grape & Wine Industry Council has set a goal of 10,000 acres of wine grapes by 2024. Those participating in the 2014 Michigan State University Extension Wine Grape Establishment Conference planned to start 18 new vineyards and wineries with a potential investment $1.850 million in a three-year period.

A critical factor in planning for new wine V. vinifera grape vineyards is financial. A principle resource for estimating costs has been the Cornell Cost of Establishment and Production of V. vinifera Grapes in the Finger Lakes Region of New York, or EB 2014-01. Considering the similarities between Michigan’s major wine grape areas, and New York’s Finger Lakes, as well as, the comprehensive economic methods applied, this bulletin is regarded as the best available resource to growers on this topic. 

The 2013 estimated cost of establishing and maintaining a V. vinifera planting to production (three years) on a commercial scale on a prime site is $32,360 per acre in the Finger Lakes Region of New York State. This compares with an approximate cost of $28,609 per acre in 2010.

Among the assumptions made across the 13 cost categories are the cost of land, vineyard size, grape varieties, harvest methods and labor. In this paper, land was valued at $6,000 per acre, vineyard size was 50 acres, varieties planted were Pinot Noir, Cabernet Franc, Chardonnay, and Riesling, harvest method was by machine, and skilled labor was valued at $20 per hour. All costs are presented in a thorough manner.

The authors advise awareness of changing markets, the availability of labor, and the inherent fluctuation in agricultural situations when considering an investment in a wine grape vineyard.

For information on food, agriculture, bio economy and natural resources business development, contact the Michigan State University Product Center or call 517-432-8750.

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